Earlier this month, some UberX drivers in Calfornia found themselves between a rock and a hard place: The state started requiring ridesharing service drivers to register their cars as commercial vehicles, but Uber in turn suspended some drivers who did just that.

However, according to the San Francisco Chronicle, California's Department of Motor Vehicles has since reneged on its earlier policy decision, and has dropped the commercial registration requirement. According to the report, DMV officials "will meet with regulators and the industry to work through the issue," presumably to develop a policy that all sides can agree to.

The whole matter began on January 5 when the DMV issued a memo that outlined the agency's policy regarding ridesharing drivers. The memo stated that "any passenger vehicle used or maintained for the transportation of persons for hire, compensation, or profit is a commercial vehicle," and that "even occasional use of a vehicle in this manner requires the vehicle to be registered commercially."

But according to BuzzFeed, UberX drivers who complied with the DMV's policy found themselves running afoul of Uber's own policies, which state that UberX drivers need to have a non-commercial auto registration. Drivers with commercial registration instead need to have an UberBLACK account.

The story behind the story: Local and state governments and regulatory agencies are still trying to figure out how to treat ridesharing services like Uber and Lyft, which fall into something of a gray area—they're not quite taxis, but they still compete with taxis.

Although California's DMV may have backed off of Uber, the company still has some issues to work out with California regulators: In September, the state's Public Utilities Commission said that Uber and Lyft's split-the-fare carpool services were illegal under California law. Meanwhile, in December, the district attorneys for Los Angeles and San Francisco Counties filed unlawful business suits against Uber. Needless to say, this likely won't be the last legal drama for Uber in the state. Stay tuned.

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